TWO | The Customer: Joined at the Hip

“An enterprise’s purpose begins on the outside with the customer…it is the customer who determines what a business is, what it produces, and whether it will prosper.”

On paper, it seems like the most obvious notion: The customer is in the driver’s seat, at the control panel. What could be more fundamental? And yet few organizations, busy with all they are doing inside their own walls, are truly focused on the outside world of the customer.

If you are in business, beware. The silent revolution of technology and demography described in the last chapter has given each customer his or her own handy remote control. Everything has changed about your customers and your relationships. You’ve never had as many people around the globe to reach. And they reach you, too, one by one, not as a homogeneous group. Dozens, maybe hundreds of factors influence the way these individuals around the world see value. Customers aren’t just in the driver’s seat these days; they are also gassing up the vehicle, doing some of the service, and controlling a fair amount of the traffic on the road.

Peter Drucker’s conviction that the customer is at the center of it all shaped his thought from the very start. As a young journalist in the 1930s, Peter credited Time-Life’s success to Henry Luce’s understanding of the customer rather than his journalistic savvy. In Peter’s first management book, Concept Of The Corporation, he attributed General Motors’ success to Chief Executive Alfred Sloan’s unique understanding of the customer, not Sloan’s scientific approach. As recently as 2004, in his last Wall Street Journal editorial piece, “The Role of the CEO,” Peter again said that everything begins with understanding the customer. In today’s world, where customers are standing up and taking control, understanding your customers and the value you provide to them is more critical than ever.